ARM eyes Kilifi mining licence

Cement maker ARM is seeking government approval to mine limestone in five areas within Kilifi County.

According to a Kenya Gazette notice published last Friday, the NSE-listed manufacturer is seeking to mine the raw material over 24.9310 km² in the Chonyi, Pangani, Chauringo, Maereni and Mazeras areas. The Ministry of Petroleum and Mining invited objections to the bid to be made within 42 days.

This is the cement company’s third application after similar moves for permits in Kajiado and Makueni counties made last month which are currently under consideration by the ministry. ARM chief executive Pradeep Paunrana said last month that the three mining licences it was seeking are to help feed existing operations and that the application would help regularise the company’s permits in line with the new Mining Act.

The troubled firm’s move for a share of the Coastal limestone comes about two years after its operations in the county faced opposition from locals. Human rights activists had raised concerns over dust emissions from an ARM plant, which they said were harming the local community and livestock. Approval will increase competition for the mineral with Bamburi Cement, Mombasa Cement and East African Cement as local consumption remains on the rise, after falling by 8.2% to 5.8 million tonnes in 2017.

Official data shows that cement production in June increased to 454,322 metric tonnes from 452,054 metric tonnes in May. ARM currently controls 5.5% of the local cement market, making it the smallest player of the five leading firms in the sector led by Bamburi Cement at 32.4%. The firm has seen its fortunes take a hit as it cited operating economic conditions as the reason for a decline in performance of its regional businesses.

The cement maker made Sh6.5 billion net loss for the year ended December 2017 as auditing firm Deloitte accused ARM of misrepresenting its financial statements to conceal up to Sh21 billion debts.